"We are considering the acquisition of a Chinese company, and establishing a subsidiary in India," ECI's chief operating officer, Rafi Maor, told business daily 'The Marker'.

India's main allure is the combination of talent and low costs. If ECI opens anything there it would be an R&D facility, Maor said.

The putative Chinese arm would engage in development, production and marketing too, selling at relative low prices, he said.

"ECI is a communications company operating in the global arena. We have to stay on top as major processes are happening in this field," the executive said explaining the move.

"The competition is fierce. New players are rising ... and they have low cost structures, which forces us to adapt our costs structures to the market, in order to remain competitive," he added.

Blaming the government apathy in the sector for the adjustments Israeli companies are undergoing by opening R&D facilities in India and China, Maor said, Israel's hi-tech facilities will have difficulty developing further if this continues.

At ECI itself, he said, though there won't be extensive job cuts in R&D, it might streamline a little, "but only at the margins."

ECI develops advanced telecom solutions for phones and telecom service companies, as well as metro optical networks, broadband access systems, broadband management VoIP (Internet phone) solutions.